Following a request made by South Africa’s Ministry of Mineral Resources for more details pertaining to Xstrata’s proposed merger of equals with the Anglo American diamond mining giant, Mining Weekly points to a possible softening in the South African stance in the matter of the merger.

Mineral resources departmental spokesperson Jeremy Michaels disclosed that diamond miner Xstrata’s CEO Mick Davis and Anglo’s CEO Cynthia Carroll had met with South African Mineral Resources Minister Susan Shabangu and Mineral Resources DG Sandile Nogxina

The government has now adopted a stance of close observation of developments.

Mining Weekly quotes Michaels as stating: “We are watching the Xstrata proposal very closely. We’ve asked for more detail to get the full picture of the implications. As we have said before, our concerns are what the impact of such a proposed merger would be on mining jobs and competition in particular and we will continue to engage with them about it.”

Xstrata executive GM group strategy and corporate affairs Thras Moraitis stated recently: “We can help to create more engineers. We know that South Africa is low on the scale of engineering graduates, while the graduation of a large number of engineers in emerging countries like India and China is at the core of the engine that is growing those economies, and we need to redress that in South Africa."

Moraitis added that the merging of BHP and the Billiton mining companies had resulted in the creation of the world’s leading diversified mining company and noted that the merging of the Anglo and Xstrata mining giants could result in the combined entity being able to go “toe-to-toe” with BHP Billiton, which yielded a 389% return for shareholders during the merging.

Xstrata has offered assurances that it will refrain from South African retrenchments at the operational level.